New Requirements for Pipeline Projects James D. Bradbury, PLLC

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1 New Requirements for Pipeline Projects James D. Bradbury, PLLC

2 New Pipeline Requirements City of Fort Worth Pipeline Ordinance (1/09); Texas Midstream v. City of Grand Prairie; Legislative Update on pipelines.

3 City of Fort Worth Ordinance As a part of the substantial revisions to the Gas Drilling Ordinance, COFW enacted a pipeline ordinance, including requirements for saltwater pipelines. Became effective January of this year.

4 Background on Municipal Regulation Pipeline Safety Act of 1994, provides federal minimum standards for safety and precludes municipal regulation; Texas Utility Code vests exclusive jurisdiction to the TXRRC over safety standards, but allows municipalities some authority; Municipalities may adopt standards related to mapping, inventorying or relocation of city streets or private residential areas.

5 COFW Ordinance is targeted to ensure the compatibility of pipelines and facilities to surrounding uses, reduce noise, maintain property values and protect quality of life. Ordinance divides pipelines into city regulated pipelines and state or federal regulated pipelines.

6 Why does COFW need a Pipeline Ordinance? Density gathering lines and connecting lines more dense than ever seen in urban context; Duplication multiple producers must build out to interstate transmission lines; Knowledge City must know where all of the lines are located; Future Land Use and Planning pipelines have a significant impact on future use by city and private development.

7 Section Highpoints Pipelines may not interfere with existing utilities or ROW; Must restore to original condition; Must meet or exceed federal and state requirements; 10 days prior to construction, operator shall give written mailed notice to all tenants, property owners and residents that are located adjacent to proposed line.

8 Filing with City As built, record drawings and plans; GPS locations of line; Data compatible with City GIS; Disclosure of substance to be transported; MSDS sheets; Engineering plans, showing depths, shutoff valves, other pipelines or utilities within 15 feet; All property owners, tenants or residents adjacent.

9 Other Requirements Must participate in One Call Annual update of contact information for shutoff, emergency and materials; Provide City with any reports made to State or Federal regulators; Annual report to City that pipeline has no outstanding safety violations.

10 City Regulated Pipelines Must incorporate all federal and state requirements for lines between well and first transfer; Obtain permit; When applying for well permit must show proposed route to reach transmission line; Must submit application to COFW BEFORE making any offer or initiating any negotiations in residential area.

11 Gas Drilling Review Committee Any pipeline passing through a private residential area in the City must be reviewed by GDRC, a committee of specified City departments. Public notice and opportunity for citizen input; Technical advisor can be employed, as needed; City Council can authorize an independent study.

12 Other Requirements Abandonment procedures; Required Emergency Response Plan Notice to adjacent property owners of repair or maintenance work; Pipeline markers; Permission required to place line on, over, under or along any public ROW, utility easement or City owned property.

13 Saltwater Pipelines Must obtain permission from the City; Designed and sealed by a professional engineer; Locate 5 feet below City utilities; Automatic shutdown system; Markers.

14 Texas Midstream v. City of Grand Prairie Case filed in Dallas federal court by TM to challenge and void GP ordinance on compressor stations. TM argued that compressor station was part of a federally regulated pipeline and GP s ordinance was a safety regulation and thus preempted by federal law. Injunction was requested allowing TM to build where and how it wished.

15 Judge Fitzwater s Decision Majority of GP Ordinance was not adopted for safety thus was not preempted by federal law. Setbacks, design features, landscape and material requirements were appropriate areas for regulation and TM was bound to follow them. Entered injunction on part of GP Ordinance that required 8 foot fence.

16 West Fork Partners, LP v. Chesapeake Exploration et. al Does a pipeline subsidiary have to honor lease conditions in favor of the mineral owner lessor? Case just filed and now in Judge Fitzwater s court for determination.

17 Legislative Update Numerous pipeline bills filed this session. Municipalities and counties seeking greater authority to regulate; Citizen demands for greater protection; Industry desire for uniform requirements.

18 HB 1535 Burnam Requires RRC Process and Approval for pipeline routes. (mirrors the PUC approach to transmission lines) Notice to affected persons; Limited to Tarrant County; Apply with proposed route and three alternatives; Must include feasibility study of using existing ROW; Hearing upon request; Market need assessed.

19 SB 686 Davis/ HB 876 Orr Texas Department of Transportation shall allow subsurface access to its controlled access ROW for installation of natural gas pipeline if it does not interfere with existing utilities. TxDot may regulate horizontal and vertical location.

20 SB 2433 Davis Pipeline operator that seeks to acquire an easement on property or ROW held by a municipality must provide city notice of proposed line and time to consider. Within 60 days, city must either consent or suggest a feasible alternative considering city s: Comprehensive plan; Transit development plan; Economic development plan.

21 SB 2433

22 SB 2401 Davis Bill clarifies and modifies existing RRC requirements for identifying and repairing pipeline leaks.

23 HB 4441 Gonzalez Toureilles Confers exclusive jurisdiction on RRC to establish standards for pipelines and appurtenant facilities. In doing so, RRC must: Encourage use of public streets, roads, highways, and other existing ROW; Require pipeline companies to minimize impact on existing land use; Prevent public entities from prohibiting use of ROW.

24 HB 3729 King County may allow subsurface access to a county road ROW for a gas line or temporary water line. County may regulate vertical or horizontal location and may charge operator for cost of relocation.

25 SB 1679 Hinojosa/ HB 1426 Crownover Common Purchaser has the right to lay and maintain a pipeline over, under, across and along a public road or municipal street or alley. Must have consent and direction of city.

26 HB 1566 England Municipalities would have authority to regulate natural gas compressor stations, considering: Proximity to residential areas; Height and size of station; Aesthetic compatibility with area; Compliance with city s comprehensive plan. May regulate safety of above ground if consistent with federal law.

27 HB 1538 Burnam County or municipality may set safety regulations applicable to a gas gathering or transmission line if consistent with federal law.

28 HB 1537 Burnam Safety requirements for pipelines, Tarrant only; Setback of 300 feet from pipeline to structure with inhabitants; Gas must be odorized; Gas must be dehydrated at wellhead; Pipelines must be coated.

29 HB 1536 Burnam Gas corporation may not condemn property for a gathering or transmission line that transports gas for a single producer.

30 SB 902 Davis/ HB 2255 Hancock Green completion bill. Limits release of gas from well site to atmosphere; For Barnett, sets prohibition after two days.

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